Navy Awards $1.33B to Electric Boat for Submarine Planning & Material, Ending 2027
Contract Overview
Contract Amount: $1,331,626,815 ($1.3B)
Contractor: Electric Boat Corporation
Awarding Agency: Department of Defense
Start Date: 2020-08-14
End Date: 2027-11-01
Contract Duration: 2,635 days
Daily Burn Rate: $505.4K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: PLANNING&MATERIAL (O&MN)
Place of Performance
Location: GROTON, NEW LONDON County, CONNECTICUT, 06340
Plain-Language Summary
Department of Defense obligated $1.33 billion to ELECTRIC BOAT CORPORATION for work described as: PLANNING&MATERIAL (O&MN) Key points: 1. Significant contract value for submarine planning and material. 2. Sole-source award to Electric Boat Corporation raises competition concerns. 3. Long contract duration (2020-2027) suggests a critical, ongoing need. 4. Focus on shipbuilding and repairing sector, vital for national defense.
Value Assessment
Rating: questionable
The contract is Cost Plus Fixed Fee, which can lead to cost overruns if not managed tightly. The benchmark for similar contracts is difficult to ascertain without competitive pricing data.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Electric Boat Corporation. This lack of competition limits price discovery and potentially increases costs for the government.
Taxpayer Impact: The absence of competition in this large contract may result in higher taxpayer costs compared to a competitively bid scenario.
Public Impact
Impacts national security through submarine maintenance and readiness. Supports a major defense contractor and its supply chain. Long-term commitment of taxpayer funds for a critical defense asset.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Cost-plus contract type
- Long contract duration
Positive Signals
- Essential for national defense
- Established contractor with relevant expertise
Sector Analysis
This contract falls within the shipbuilding and repairing sector, a critical component of national defense spending. Benchmarks for such specialized, long-term sole-source contracts are often difficult to establish due to unique requirements and limited market participants.
Small Business Impact
The data does not indicate any specific provisions or set-asides for small businesses in this contract. As a sole-source award to a large corporation, direct small business participation may be limited unless subcontracted.
Oversight & Accountability
Given the sole-source nature and cost-plus fee structure, robust oversight by the Department of the Navy is crucial to ensure cost control and performance. Tracking performance metrics and managing contractor expenditures will be key accountability measures.
Related Government Programs
- Ship Building and Repairing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Sole-source award limits competition.
- Cost-plus contract type carries inherent cost overrun risk.
- Long contract duration increases exposure to changing economic conditions.
- Lack of small business participation noted.
- Potential for reduced price discovery.
Tags
ship-building-and-repairing, department-of-defense, ct, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $1.33 billion to ELECTRIC BOAT CORPORATION. PLANNING&MATERIAL (O&MN)
Who is the contractor on this award?
The obligated recipient is ELECTRIC BOAT CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $1.33 billion.
What is the period of performance?
Start: 2020-08-14. End: 2027-11-01.
What is the justification for the sole-source award to Electric Boat Corporation for this critical submarine planning and material requirement?
Sole-source awards are typically justified when only one responsible source is capable of providing the required supplies or services. For specialized defense assets like submarines, this could be due to unique technical expertise, existing infrastructure, or national security imperatives that limit viable alternatives. A thorough justification should detail these specific reasons and demonstrate why competition was not feasible or advantageous.
How will the Department of the Navy ensure cost efficiency and prevent potential overruns with a Cost Plus Fixed Fee contract awarded without competition?
The Navy must implement stringent oversight mechanisms, including detailed cost tracking, performance monitoring, and regular audits. Establishing clear milestones and performance metrics tied to fee adjustments can incentivize efficiency. Regular communication and negotiation with the contractor, supported by independent cost analysis, are vital to manage the 'cost-plus' aspect effectively and ensure value for taxpayer money.
What are the long-term implications of this significant, non-competed contract on the overall defense budget and potential future competition in the shipbuilding sector?
This long-term, sole-source contract commits substantial resources, potentially impacting the flexibility of the defense budget. It may also reinforce Electric Boat's market dominance, potentially discouraging new entrants or limiting future competitive opportunities in specialized naval shipbuilding. The government should consider strategies to foster competition in adjacent areas or for future platforms to mitigate these long-term effects.
Industry Classification
NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing
Product/Service Code: SHIPS, SMALL CRAFT, PONTOON, DOCKS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0002419R4316
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 75 EASTERN POINT RD, GROTON, CT, 06340
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $1,361,321,508
Exercised Options: $1,338,800,505
Current Obligation: $1,331,626,815
Actual Outlays: $573,483,804
Subaward Activity
Number of Subawards: 430
Total Subaward Amount: $116,375,641
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2020-08-14
Current End Date: 2027-11-01
Potential End Date: 2027-11-01 00:00:00
Last Modified: 2026-01-14
More Contracts from Electric Boat Corporation
- SSN 802 and 803 Long Lead Time Material — $34.7B (Department of Defense)
- Columbia Class Design Completion — $24.5B (Department of Defense)
- SSN 792 Long Lead Time Material — $19.9B (Department of Defense)
- Construction of Virginia Class Block III Submarines — $16.2B (Department of Defense)
- Federal Contract — $9.4B (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)